9 Money Questions You Should Be Able to Answer by Age 30

If you are exiting your 20s, you may be gallantly resisting the urge to “adult” and actually pay attention to your finances. But it’s time to get serious, people.

You don’t need to obsess over every detail of your money just because you are entering your fourth decade of life, but there are some key things you should have a handle on if you want to achieve financial freedom and retire on time.

Let’s examine these questions you should be able to answer by the time you turn 30.

1. What is your net worth?

Your net worth is the total sum of your assets minus your debts. By age 30, you should be focused on building that net worth to a healthy sum. This means boosting your income, investing well, and keeping debt to a low level.

It means knowing how much you’re putting into your 401(k) and other retirement accounts. It means knowing how much you owe. There’s no magic number for what your net worth should be at this stage, but it should definitely be in positive territory. If you have a negative net worth, work to reduce your debt load and start saving money more aggressively. (See also: 6 Money Moves to Make If Your Net Worth Is Negative)

2. What are you invested in?

By age 30, you should be investing as much money you can in stocks, with the intention of watching that money grow for the next three decades or more until you retire. Starting at age 30 will give you plenty of time to build a sizable nest egg, if you invest well.

At this stage, you may be throwing your money into whatever investments are offered by your employer’s retirement plan. But you should take time to know precisely how your money is being invested. Are your holdings comprised of low-cost investments with a track record of growth? Are you paying high fees or commissions? And when was the last time you rebalanced your portfolio? These are the questions you should be asking yourself now, and you ought to have good answers. (See also: 8 Steps to Starting a Retirement Plan in Your 30s)

3. How big is your emergency fund?

If you’re around 30 years old, you may feel like nothing seriously bad could happen to you. But life can come at anyone, and fast. At this point in your life, you should be putting some money aside for a rainy day. An emergency fund can help you absorb an unexpected expense, such as a medical emergency, big car repair, or a busted appliance. Opinions vary on how big an emergency fund should be, but you should ideally have at least three to six months’ worth of daily living expenses saved in cash to endure a big life event. (See also: 5-Minute Finance: Start an Emergency Fund)

4. Are you on track to retire comfortably?

Retirement may be decades off, but it’s still crucial to get a sense of whether you’re saving enough now to ultimately retire when you want to. It’s been said that by age 30, you should have half your income saved. This may seem like a steep total in an era of high housing costs and student loans, but it’s achievable if you maintain good savings discipline. Calculate how much you’ll have saved by age 50, then 55, then 60. If you’re behind your target, it may be important to bump up your current rate of saving. (See also: 8 Things Millennials Can Do Right Now for an Early Retirement)

5. Are you properly insured?

Building your net worth isn’t just about making money, but also protecting it. Insurance is perhaps the one thing you will pay for that you hope to never use. You may have health insurance, but have you taken time to review your policy and understand how much you’ll end up paying out of pocket if you get sick? What about homeowners or renters insurance to protect your belongings? And what about life insurance? It’s hard at age 30 to think about illness or accidents happening, but there’s a fine line between living a carefree life and facing a financial disaster by being horribly unprepared. (See also: 15 Surprising Insurance Policies You Might Need)

6. Is your savings account the right one for you?

You’ve probably been putting money in a savings account since you were a teenager. But have you ever given any thought to how much interest your money is earning? Are you aware of what fees you’re paying? By age 30, you should be mindful of where you’re putting your money and should take time to shop around for the bank that treats you best. There are many banks out there, and you don’t have to settle for the one right around the corner. (See also: 6 Important Things to Look for in a Savings Account)

7. What is your credit score?

Your credit score is like your financial report card. A high number means you’ve been responsible with your money, and you can be rewarded with lower interest rates from lenders. By this stage of your life, you should know what your credit score is. In fact, many credit cards now tell you your score each month. Ideally, you should shoot to get your score over 800, but 700 usually means you’re in decent shape. Anything lower means you may want to take time to pay down debt, take care of any outstanding late charges, and start borrowing more responsibly. (See also: 5 Things to Do Right Now to Boost Your 600 Credit Score)

8. Are there errors on your credit report?

In addition to knowing your credit score, by age 30 you should be in the habit of checking your credit report every year. You’re legally allowed to review the credit reports from each of the major credit bureaus (Experian, TransUnion, and Equifax) once yearly, and this periodic review can be helpful in keeping your finances on track. Your credit reports may contain errors, like incorrect names and addresses, and even references to debts that aren’t yours. If you find mistakes, contact the credit bureaus to get the reports fixed ASAP. (See also: How to Read a Credit Report)

9. What is your debt-to-income ratio?

At this point in your life, you may be considering buying a home. When you seek to get a mortgage loan, lenders will want to know the ratio of your debts versus your income. A ratio that is above 43 percent is considered too high by some lenders, and you may find it difficult or even impossible to get a reasonable loan. If your debt-to-income ratio is nearing this level, it’s time to start paying off whatever loans and credit card bills you have. (See also: 5-Day Debt Reduction Plan: Pay It Off)

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